Problem 3-1A (Algo) Determine accrual-basis and cash-basis revenues and expenses (LO3-1, 3-2) Required: For each transaction,...

Transcribed Image Text:

Problem 3-1A (Algo) Determine accrual-basis and cash-basis revenues and expenses (LO3-1, 3-2) Required: For each transaction, determine the amount of revenue or expense, if any, that is recorded under accrual-basis accounting and under cash-basis accounting in the current period. Transaction 1. Receive cash from customers in advance of services to be provided, $510. 2. Pay utilities bill for the previous period, $105. 3. Pay for insurance in advance of the period to be covered, $1,550. 4. Pay workers' salaries for the current period, $710. 5. Incur costs for employee salaries in the current period but do not pay, $910. 6. Receive cash from customers at the time of service, $1,250. 7. Purchase office supplies on account, $240. 8. Borrow cash from the bank, $3,100. 9. Receive cash from customers for services performed in the previous period, $660. 10. Pay for advertising to appear in the current period, $360. Accrual-Basis Cash-Basis Revenue Expense Revenue Expense Problem 3-1A (Algo) Determine accrual-basis and cash-basis revenues and expenses (LO3-1, 3-2) Required: For each transaction, determine the amount of revenue or expense, if any, that is recorded under accrual-basis accounting and under cash-basis accounting in the current period. Transaction 1. Receive cash from customers in advance of services to be provided, $510. 2. Pay utilities bill for the previous period, $105. 3. Pay for insurance in advance of the period to be covered, $1,550. 4. Pay workers' salaries for the current period, $710. 5. Incur costs for employee salaries in the current period but do not pay, $910. 6. Receive cash from customers at the time of service, $1,250. 7. Purchase office supplies on account, $240. 8. Borrow cash from the bank, $3,100. 9. Receive cash from customers for services performed in the previous period, $660. 10. Pay for advertising to appear in the current period, $360. Accrual-Basis Cash-Basis Revenue Expense Revenue Expense